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A Wise Globalist
Japanese business sheds crocodile tears for Akio Morita
By PETER McKILLOP
October 6, 1999
Web posted at 5 a.m. Hong Kong time, 5 p.m. EDT
There have been many low points in Japan's decade-long stumble through the economic wilderness. One, however, was particularly cruel. In 1993, Sony chairman Akio Morita was finally ready to take a position he richly deserved: chairman of the Keidanren, Japan's most powerful business lobby. Tragically, he suffered a devastating stroke shortly beforehand. He died this past Sunday. Japan now mourns not just a great business leader but also a lost decade, one that might not have been so severe if Akio Morita had been around to help out.
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In 1993, as economic alarm bells began to sound in Japan, Morita was at his prime, eager and ready to lead the country into a new business era. His international legacy was already secured by the phenomenal success of a trio of Sony innovations: the transistor radio, the Trinitron color television and the Walkman. It was now time to lead his faceless, gray-suited Japanese business brethren into the modern age. Despite being perhaps the most dynamic business leader of his generation, Morita had always been regarded by Japan's clannish business élite as a troublesome maverick. He had essentially been blackballed from the top job at the Keidanren. Finally, in 1993, he was reluctantly tapped for the position that no one could reasonably deny him.
The timing of his stroke could not have been worse. The previous year, Morita had triggered a spirited debate challenging fundamental elements of Japanese business practice. In a controversial article in the weekly Bungei Shunju, he had attacked Japan's adversarial trade policies. He had urged business leaders to adopt more market-friendly practices, ranging from providing longer vacations for workers to instituting merit pay to paying attention to shareholder value. This, naturally, triggered a storm and infuriated many Keidanren colleagues. But Morita did not flinch. He entered the lions' den and, speaking before the lobby, bluntly said: "Western businesses typically sell their products at a price that will enable them to pay adequate dividends to their stockholders--and still retain a reasonable level of corporate earnings. They claim it is unfair for Japanese companies to enter the business domain with prices that are determined by Japanese market principles."
Today, Japan is still playing by its own rules, only this time it is Japan, not the West, that is being hurt. Far from following the sage advice of this globalist, Morita's stubborn business colleagues ignored his warnings. After news of his stroke, they shed a crocodile tear or two, secretly relieved, perhaps, that this rusty nail in the side of Japan had finally been removed.
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